European asset manager CoinShares hasposted a record performance in the first quarter of 2024, driven by a recovery in markets since the debut of Bitcoin exchange-traded funds (ETFs).

The company reported revenue of 19.5 million pounds ($24.5 million) for the period, a 216% increase compared to the first quarter of 2023. Gains and other income amounted to 24.4 million pounds ($30.6 million).

Earnings before interest, taxes, depreciation, and amortization (EBITDA) reached 34.2 million pounds ($43 million), up from 7 million pounds ($8.8 million) the previous year, marking a fourfold increase.

According to CoinShares’s chief financial officer, Richard Nash, the EBITDA margin for the quarter was at 78%. “This margin is starting to return to levels we experienced back in 2021.”

Approximately 45% of CoinShares' total gains and other revenue is generated by its asset management business, while 40% is derived from capital markets, and the remaining 15% originates from the company’s principal investment portfolio, explained Nash.

The company posted management fees totaling 19.5 million pounds ($24.5 million), its second-highest ever recorded, only behind fees recorded in the fourth quarter of 2021.

Valkyrie’s acquisition

CoinShares exercised an option to acquire Valkyrie funds on Jan. 12, following the U.S. Securities and Exchange Commission's (SEC) approval of Bitcoin ETFs.

The acquisition included the sponsor rights to Valkyrie’s spot Bitcoin ETF, the investment advisory business Valkyrie Investments, and the sponsor rights for several similar products, including Valkyrie Bitcoin Miners (WGMI) and Valkyrie Bitcoin Futures Leveraged Strategy (BTFX) ETFs. 

The deal was completed on March 12. According to CoinShares, the acquisition added approximately 1.6 million pounds ($2 million) of goodwill to its balance sheet—an accounting term representing intangible assets during an acquisition.

CoinShares’ total assets under management as of March 31, 2024 were 4.77 billion pounds ($6 billion).“The AUM figure has risen since the end of 2023 of 58% due to the performance of the wider industry in Q1 2024 which saw significant price increases across the board, in conjunction with the acquisition of Valkyrie,” reads the earnings report.

According to CoinShares CEO Jean-Marie Mognetti, Valkyrie’s acquisition aligned with plans to become a leading global investment company specializing in digital assets. “The U.S. market accounts for 50% of global assets under management and offers a unique opportunity for CoinShares in terms of growth.”

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